Utilities for a new IP

Hi,

10 days to settlement for a new and first IP (~9 yo 3 bedroom townhouse).

I've got some questions and would like to ask for some advice on what my to-do list should be...

1) Gas electricity and water. Do I need to connect all of them (electricity, I will, for rental inspections, but what about the rest)? Would they be in a disconnected state and do I have to pay for re-connection? Not sure what the process / cost are...

2) I haven't yet decided on a property manager. I wonder if going with the same agency who sold the property would be a good idea? I spoke to the property manager at the agency and she seems to know the area well and has managed a townhouse in the same complex and also a neighbour in the same street.

2a) Another property manager from another agency has a promotion of a 6 month free management fee. How can I best leverage this to get a better deal out of another property manager?

3) Any other general advice for a first timer?

My to-do list are:
- Get depreciation schedule done.
- Clean up the place and fix some small stuff.
- Connect utilities.
- Obviously appoint a property manager.
- What else?

Thanks so much.

 

1. Leave it for the tenant/pm
2. Whoever is best! Shop around and find referals not just the sales pitch from the pm
2a. Forget the "specials". Refer to 2. The 700 bucks you save on the meal deal can easily turn to $thousands in pain for you.
3. Talk to every pm in town! Compare all the fees and charges. Then when you're confused af. Call them all again! Don't be afraid to make them work for it. There is a high turn over of pm staff so the gold plated person you speak to today could easily be a muppet tomorrow; )

Have fun!

 

Thanks... Sometimes, I wonder why PM would spend much time selling to you (as compared to their peers in sales who make 10x what they make).

Another thing... I've got PMs coming in with rental appraisal figures. How much should I discount them? Is it better to go in with a lower amount and have the property rented quickly, or start high and wait out for a tenant to bite?

 

As Bob shovel pointed out!
Also, be careful with fixing, whether it will be a repair or improvement, hopefully your specialist property accountant can further advise?
I never connect utilities the tenants connect those (unless I was selling and inspections/viewing was required at night?).
Compare PM contracts and charges and do little research on what the rent should be.
Rented quickly - by all means, time is vital too in running a business there is a holding cost of the loan to pay, what does it cost you each week do the calculation?
Say $500 rent/week over 48 weeks (4 weeks to rent) = $24,000 as compared with say $480 rent/week over 51 weeks (1 week to rent) = $24,480. Just do the numbers and see if it stacks up....
I hold many IPs hence for me the cash flow (regular rent coming in) is much more vital that higher rent in $ terms.... I also like to rent all IPs around 10% under the median rent (that is just me - you need to find out what works for you).
Congratulations and perhaps post lessons learned?

 

Beware of rental appraisals. Some PMs will quote high so you sign with them rather than a more honest PM. You will only get what the market pays.

Do your own research. Check online for similar properties in your area available for rent. Price your property close to the bottom price of similar rentals.

Waiting weeks for that extra $10 or $20 a week is a waste of time and money. Over 12 months, $480 per week with an immediate tenant gives you around the same return as $500 per week with a two week vacancy waiting for a tenant.
Marg

 

Ask for a sample copy of their inspection report. My new PM uses an iPad app and emails within hours of inspection.

 

Leave the electricity connection for the tenant, depending what state your IP is will depend on how water is charged.

When choosing a Property Manager check their Google Reviews, always good to look on realestate.com to check online presence etc to see how they advertise their properties. Be careful of offers like 6 months free sometimes this can cost you more in the end than saving 6 months on management fees.